By Michael Hogan
HAMBURG, Dec 15 (Reuters) - A U.N. court on Saturday ordered the release of an Argentine naval training ship detained in Ghana at the request of a hedge fund trying to force Argentina to pay up on defaulted government bonds.
The Argentine navy’s tall sailing ship ARA Libertad, a training vessel, was held in Ghana’s port of Tema on Oct. 2 after a court order obtained by NML Capital Ltd, which says Argentina owes it $300 million on bonds which have been in default since 2002.
International Tribunal for the Law of the Sea president judge Shunji Yanai of Japan said the court ruled Ghana should release the Libertad immediately and provide the assistance the crew needs to leave the port.
Argentina had argued the United Nations maritime convention gives warships including unarmed training vessels immunity from civil claims when calling in foreign ports.
Creditors including NML have won several billion dollars in damages over Argentina’s bond default in U.S. courts, but they have largely been unable to collect because most Argentine assets are protected by sovereign immunity laws.
“Argentina will continue to defend itself from financial pirates. Vultures without the frigate and without the debt,” Economy Minister Hernan Lorenzino said on Twitter after the ruling.
Argentina refers to funds like NML as “vulture funds” because they buy distressed or defaulted bonds and then sue in international courts to get paid in full.
Ghana’s government said in a statement it would consider the tribunal’s order, weighing its international obligations against the authority of Ghana’s High Court, which had detained the ship.
“The Government of Ghana will carefully consider the Tribunal’s Order with a view to ensuring that it is given effect, having regard to the requirements of the Constitution and the country’s international obligations.”
A lawyer for NML in Accra, Ace Ankomah, said he was not yet aware of the ruling and could not comment.
A skeleton crew of sailors remains on board the Libertad after around 300 crew and naval cadets were flown home to Argentina in October.
The court considered a statement from Argentina that attempts by authorities in Ghana to move the ship “could lead to an escalation” which could lead to “incidents which could endanger life,” Yanai said.
The court also considered Argentina’s claim that the ship could not be maintained correctly during its arrest and that the vessel’ safety could so be endangered.
The two countries must provide a further report to the court by Dec. 22, 2012, and if further measures would be considered if the ship has not been released by this date, Tribunal Judge Ruediger Wolfrum told Reuters.
Both countries must pay their own costs.